The Consumers’ Forum launches new claim details for bank charges

The Consumers' Forum is once again leading the way! it is pleased to announce the release of new particulars of claim that provides a way forward for consumers to recover their bank charges, based upon new legal arguments.
 
July 26, 2011 - PRLog -- The consumer movement to reclaim unlawful bank charges was one of the most spectacular examples of direct action by the public against UK businesses.  Between 2005 and 2007, more than a billion pounds is estimated to have been repaid by banks, before the High Court litigation that effectively ended the reclaiming movement in 2007.

In a 2009 judgment that surprised many people, the Supreme Court held that the charges were lawful, as they were part of the price of ‘a package of services’, although this had never been notified to any customer and this was in direct contrast to the earlier defences given by the banks to customers, the County Courts, the Commercial Court and the Court of Appeal, where the banks insisted that bank charges were designed to recover actual costs.  However, the Supreme Court ruling did make it clear that the charges might still be challenged using different legal arguments, because the OFT only challenged the charges on a narrow point of law.  

Despite this revelation, the regulators have failed to act subsequently to protect consumers from these charges, which are still applied by the banks with impunity and disregard for both the law and fairness.  The Coalition Government also pledged (1) in 2010 “…to end unfair bank and financial transaction charges”, but has failed to act on this, leaving thousands of consumers having their money taken, sometimes even from their benefit entitlements.  In extreme cases, people have lost their homes and livelihoods through the spiral of debt created by these extortionate charges.

Stephen Hone of the Consumers’ Forum states:
“Many of the victims are those with little financial flexibility who are often among the most vulnerable people in society.  Despite this, the banks continue to make outrageous profits from these charges, in order to subsidise free banking for those that do not struggle financially.  As with their huge bonuses, it’s still business as usual for Britain’s discredited banking sector.”  

In the absence of any action by the Government or its regulators, consumers are left with no option but to take on the might of the banks once again to obtain justice against these charges, which continue to ruin so many people’s lives.  The Consumers’ Forum is once again leading the way on this and is pleased to announce the release of new particulars of claim that provide a way forward for consumers to recover their bank charges, based upon new legal arguments that are not blocked by the Supreme Court ruling.

Further details can be found here http://www.penaltychargesforum.co.uk
For further information, contact media@penaltycharges.co.uk

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The Consumers’ Forum (formerly Penalty Charges Forum) is a free online forum that supports consumers in a range of issues including reclaiming unlawful charges applied by banks.


Background to bank charges

Between 2005 and 2007, more than a billion pounds is estimated to have been repaid by banks, which chose not to go to court to defend their bank charges, which they always maintained reflected the actual costs incurred for dealing with situations where current accounts had insufficient funds to meet payment requests.  The Office of Fair Trading’s (OFT) own research (2) shows that in 2006, UK banks earned more than £2.6bn (30% of all revenue) from these charges.  

The reclaiming stopped in July 2007, when the banks made a private arrangement with the OFT to go to the High Court to obtain a definitive ruling on the legality of these bank charges, and all claims were stayed pending the outcome of the litigation.  The Commercial Court held that the charges could be assessed by the OFT for fairness and that decision was upheld by the Court of Appeal.  However, the banks appealed again to the Supreme Court, by using a completely different set of arguments to justify the charges, namely that they were actually part of ‘the price for a package of services’.  In effect, this was an admission that bank charges generated a huge profit for the banks, which they used to subsidise free banking for people whose accounts remained in credit.  Those with little money were subsidising those better off.  Surprisingly, the Supreme Court upheld the appeal, despite the fact that the arguments advanced bore no relationship to earlier claims made on oath to other courts.  

Despite the charges previously reclaimed, the amount still owed back to customers for bank charges alone is estimated to be in excess of £10bn.

References
(1)    (1 ) The Coalition: our programme for government.
(2)    (2)  Personal current accounts in the UK: An OFT market study, OFT 2008.

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The Consumers forum now offers FREE advice and information covering a very wide variety of different legal problems. We have step-by-step guides, template letter and copies of the legislation all ready for you to use, and the best part it’s all FREE.

It is our aim is to make you aware of your rights as a consumer, enabling you to fight back, against large corporations/local authorities that abuse their position. On the website's forum you will find a large selection of different categories that we offer advice on. Here is a very short example of some of those: Credit Agreements, Debt Collection Agencies, Holiday Companies, Bailiffs, Landlords & Tenants, Payment Protection Insurance, Traffic Offences, Utility Suppliers, Harassment, and of course both Bank Charges and Credit Card charges.
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